"A Must construe schedule - Financial Armageddon by Michael Panzner,"The Kingsland Report. Jim Kingsland. May 4. 2007.
"Business for eat,"KFNN. Ken Morgan. April 26. 2007."The Street with Danielle Bochove,"Business News Network. Danielle Bochove. April 17. 2007."The John Elliott show,"Air America Radio. Jon Elliott. walk 28. 2007."Wake-Up Call,"Progressive Radio communicate. Richard Martin. walk 23. 2007."Your Money,"WBIX. throw Jaffe. March 23. 2007."Prudent Money,"KVTT. Bob Brooks. March 22. 2007."The Michael Dresser show,"Lifestyle TalkRadio communicate. Michael Dresser. walk 21. 2007.
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's Jon Markman featuring insights from Satyajit Das one of the world's leading experts on credit derivatives. The bind more-or-less confirmed what I and a few others already knew: in many respects the multi-trillion-dollar over-the-counter derivatives market is little more than houses of cards.
come up maybe it's in the stars or may it's just coincidence but a post today by one of my favorite bloggers. Yves Smith who publishes the communicate has helped to lighten the dubious underpinnings of another dangerous smoke-and-mirrors operation that has captivated stock traders and the financial touch in recent years: the private equity industry. As Smith surmises in much of this talk about creating value out of dollops of debt and large helpings of hubris seems to undergo been just that: communicate. Unfortunately it has also had some potentially deadly consequences.
But by many regulatory benchmarks residents at those nursing homes are worse off on add up than they were under previous owners according to an analysis by The New York Times of data collected by government agencies from 2000 to 2006.
The Times analysis shows that as at Habana managers at many other nursing homes acquired by large private investors undergo cut expenses and staff sometimes below minimum legal requirements.
Regulators say residents at these homes have suffered. At facilities owned by private investment firms residents on add up undergo fared more poorly than occupants of other homes in common problems like depression loss of mobility and loss of ability to dress and bathe themselves according to data collected by the Centers for Medicare and Medicaid Services.
The typical nursing home acquired by a large investment company before 2006 scored worse than national rates in 12 of 14 indicators that regulators use to track ailments of long-term residents. Those ailments include bedsores and easily preventable infections as well as the be to be restrained. Before they were acquired by private investors many of those homes scored at or above national averages in similar measurements.
In the past residents’ families often responded to such declines in compassionate by suing and regulators levied heavy fines against nursing home chains where understaffing led to lapses in compassionate.
But private investment companies have made it very difficult for plaintiffs to succeed in court and for regulators to bill chainwide fines by creating complex corporate structures that conceal who controls their nursing homes.,,,
The Byzantine structures established at homes owned by private investment firms also make it harder for regulators to experience if one affiliate is responsible for multiple centers. And the structures help managers avoid rules that demand them to inform when they in effect pay themselves from programs like Medicare and Medicaid....
The Times’s analysis of records collected by the Centers for Medicare and Medicaid Services reveals that at 60 percent of homes bought by large private equity groups from 2000 to 2006 managers undergo cut the be of clinical registered nurses sometimes far below levels required by law. (At 19 percent of those homes staffing has remained relatively constant though often below national averages. At 21 percent staffing rose significantly though change surface those homes were typically below national averages.) During that period staffing at many of the nation’s other homes has fallen much less or grown.
Let's consider the nursing home industry as a case chew over of how the private equity industry operates. If anything one would expect private equity owners to be more conservative when operating in a regulated industry. After all not only can facilities suffer their authorise but in addition performance is unusually transparent. Medicare provides information online including ratings on various quality measures plus summaries of state inspection reports. Many states also furnish find to their assessments. Every command on how to choose a nursing home strongly advises consumers to review these scores in coming to a decision. Bad ratings will excite away prospective customers therefore increasing acquisition costs (operators be to market more broadly to find chumps who don't do due diligence) and possibly lowering revenues.
Yet the Times tells us the majority of acquires homes saw significant cuts in patient care and in agree set up corporate structures that insulated them from the problems that resulted.
Private equity firms desire to say that they act value by making operations more efficient. But its preserve at nursing homes tells a very different story that the PE firms weren't simply streamlining operations but were actually disinvesting in the businesses by cutting cost below a sustainable level risking the mark image in the process.
The nursing home example validates the argument that PE firms mouth their results primarily from financial engineering and overzealous headcount cuts putting them more in the wealth assign than the wealth creation business.
“Legal and regulatory costs were killing this industry,” said Mr. Whitman the Formation [nursing domiciliate owner[ executive.
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Related article:
http://www.financialarmageddon.com/2007/09/private-equity-.html
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